The secret to growth marketing

You've got to k.i.s.s.

Keep It Simple Stupid. (Sorry for calling you stupid, we were just trying to make a point).

It’s easy to get overwhelmed by the thought of growth marketing, and find yourself making things overly complicated, but it’s actually pretty simple.

At least according to Sam Day it is, and he’s the Senior Marketing Manager for HelloFresh, which has grown to become the largest meal kit delivery service in the world, so we’re inclined to believe him.

The Copy Club was lucky enough to have a talk with him as he ran us through HelloFresh’s approach to growth marketing, but if you’re just after the breakdown, we think it can be summed up with these 5 points.

 

1. SURVEY YOUR CUSTOMERS

Here’s a quick exercise: Imagine HelloFresh’s key customer in your head.

You’ve probably gotten it completely wrong, and you wouldn’t be alone.

HelloFresh themselves were surprised when they discovered that their key customer wasn’t a single, culinarily-challenged man living in the heart of a city like London, but instead is most likely a woman, living in the suburbs, away from the supermarkets and whose main struggle is figuring out what to cook for her family. Especially when it can be such a drain on her time.

Which brings us to our first point. The foundation of a great marketing strategy is knowing your customers, and knowing why they’re your customers.

You can’t make assumptions about who your audience is, or hold on to ideas of who you’d like them to be. You’ve got to spend the time and effort to look at who’s using your product and why. Once you’ve done that, you can create products that better solve their problems, and better communicate the value of those products.

HelloFresh gains a better understanding of their customers and the problems their product could solve by breaking them down into four pillars:

• Personal insights

• Top Problems

• Top Goals

• Pain Points

Knowing that it’s the convenience and variety that HelloFresh provides that solves their key customers’ top problems allows them to know where their focus should be in terms of product development and marketing communication.

 

2. TURN CUSTOMER CARE INTO A DATA COLLECTION POINT

It isn’t enough to just know who your audience is, you’ve got to have insights into their behaviours. Knowing their media habits, for example, will massively help you in figuring out which channels to focus your marketing budget on.

There are lots of ways to start building up data about your audience, but for HelloFresh, the first port of call is customer care. 

Customer care is where your consumers will go when something goes wrong, so if you catalogue their complaints correctly, you’ll start to build up an image of what’s most important to them.

HelloFresh CEO and co-founder, Dominik Richter talks about data like this as both a ‘product’ and ‘an unfair advantage’. The key to making all this information useful is to have a clear process for implementation.

For HelloFresh, it’s all part of a process that begins and ends with customer care in a never ending loop, as illustrated below. The important thing for every business to consider is how to make sure this information loop is streamlined, and has a cadence that allows enough time for the information gathered to be implemented and tested. Getting the right processes and tools to achieve this will be essential to success.

 

3. CHOOSE YOUR METRIC FOR SUCCESS

This is another one that seems obvious until you think about it. We all think we know what success looks like, but there’s lots of different ways to measure it, depending on what’s most important to you.

There are a few key points that HelloFresh looks at:

• Customer Acquisition Cost (CAC)

• Customer Campaign Value (CCV)

• Return on Investment (RoI)

• Revenue

• Customer Value Added (CVA)

Of these, CVA is their most important because it’s the value that a customer brings after all the costs are removed, and so provides a more holistic view of which campaigns or channels bring the most growth.

The infographic below sheds some light on how it’s calculated and how it ties more directly into a campaign or channel’s efficacy.

Ultimately it’s for you to decide which is most important for your business, and it’s something that will likely change at different points in the business’ growth, but you can’t achieve success without knowing what success looks like to you.

If you’re struggling to work this one out, check out this KPI workshop.

 

4. AIM FOR THESE THREE GOALS 

• Drive retention

• Increase Average Order Value (AOV)

• Push conversions

For Sam, this is at the heart of growth marketing, and why he believes it’s more simple than we sometimes make it seem.

There are obviously lots of tactics that can be used to achieve these goals, but the trick is to remember that everything is to get to these ends.

HelloFresh has a lot of different strategies, but one of their most important — and perhaps controversial — is the use of discounts.

HelloFresh’s experience with discounts is also a fantastic case-study in the push and pull of a business’ needs.

Originally their approach centred around providing huge discounts for a single box, and as a result their acquisitions were huge. They soon discovered, however, that their retention was particularly low, with many people seemingly seeing the huge discount as an excuse to indulge in a one-off treat, rather than incorporating HelloFresh into their day-to-day life.

So they experimented with smaller discounts for multiple boxes, and discovered that by introducing them to the brand over an extended period of time, the customer was far more likely to continue using HelloFresh.

So potential customers are converted by the promise of a discount, retain the product longer as they see how much value it confers, and once a part of the fold, can be sold add-on items to increase their AOV.

One tactic that meets or complements HelloFresh’s three central goals for growth marketing.

 

5. TEST EVERYTHING. 

This follows directly on from the last point and is a theme that runs through all of them, but it’s important enough that it deserves its own section.

Whether it’s the length of the discounts you provide, the way you measure success, or who you think your audience is, testing is essential.

We believe in this so much, we’ll let you take a peek behind the curtain and see how we’re testing this very newsletter. Feel free to download this format for your own tests.

The best way to challenge your assumptions and discover better ways of working is to test them. You might discover that the conventional wisdom isn’t so wise after all, at least not for your business.

So, that’s our summary, but if you’d like to hear the juicy details from the man himself, have a watch of his presentation.